Uber is in negotiations to buy Grubhub in an all-stock deal, potentially giving the ride-sharing company's delivery arm Uber Eats a leg up in the crowded U.S. food delivery market.
Gloria Tso reports.
Ride-sharing company Uber is in talks to buy food delivery company Grubhub in an all-stock deal.
That's according to sources familiar with the matter.
A merger could give Uber's delivery arm Uber Eats a leg up on market leader DoorDash, turning the crowded U.S. food delivery market into what one analyst called a quote "two-horse race." The potential acquisition suggests that Uber is doubling down on its fastest-growing service to adapt to what is likely to be a long business interruption.
Uber Eats has been a drag for the company since its 2014 inception due to heavy spending on customer promotions and driver incentives But the service's first-quarter revenue soared more than 50% as stay-at-home measures shuttered restaurants and upended Uber's core business of shuttling people around from place to place.
The potential merger has sparked comments from lawmakers concerned about low wages for drivers and exploitation of local restaurants.
But antitrust experts said the deal, if signed, would likely win approval from regulators.
The value of the deal remains undisclosed and sources say there is still no certainty the two companies will reach an agreement.
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